New house with partner - tenents common question?!

richweeks

Hi There,

I recently bought a house - I personally paid all of the money relating to the purchase of the house (deposit, stamp duty, taxes, fees, solicitors fees etc) totaling around £60,000.

I have moved in to this house with my partner. We are not married or engaged - and have been going out for a couple of years. We have set up a joint account together - and are paying £1000 in each from our personal account to cover the following:

- Mortgage repayments,
- Bills repayments (water, energy, gas, tv, Internet),
- Shopping payments

Our plan is for me to look be on the mortgage for now alone - and then in a couple of years when we re mortgage - for my partner to join me on the mortgage and pay off the same £60,000 i put up initially.

Our relationship is strong but I realize it's sensible plan for the worst - so I was wondering if someone can tell me legality of my situation if we were to split up? I have read a little about something called Tenants in common - which I think would give my partner some ownership of the house?

I'd like to know more about this - what is it/
What are the conditions where this apply?
How much share in the house would they be entitled to (I presume it wouldn't be 50:50 given I have put in much more money)?

I don't feel comfortable signing a formal document with my partner - and am actually fine with them having a share of the house without their name being on the mortgage - as long as it is proportional to the amount they have put in to the property (although if we split up - I presume I would be able to deduct a reasonable amount of rent from theyre payments....)

Many thanks for helping me clarify before I proceed!:D
Rich

getmore4less

separate the mortgage and house costs from the rest of the living costs

unless you agree something else(*see below) your initial equity(beneficial interest) split will be
you £60K + 1/2 the mortgage
OH 1/2 the mortgage

when you sell/split you get that share back and then pay off 1/2 the outstanding mortgage each from that share.

.........................................
* You imply there is an agreement that the OH can buy in for the same £60k even if the place has gone up that is the equivalent to the get your deposit back and split the rest 50:50.

This is the same as you lending £30k(interest free) to the OH so they own 50% of the property.

When they put in their £60k it is the same as them paying back your 30k and you both paying £30k each off the mortgage.

if they don't have £60k but £30k they could just repay their debt to you and you don't pay anything off the mortgage.

richweeks

Thanks getmore4less - I'm a little confused about how much share in the house my partner is entitled to if they pay the mortgage with me?

Lets say I alone have paid:
Stamp duty (£15,000), legal fees (£2000), deposit (£43,000)
totaling £60,000

Then together we have both paid £20,000 off the mortgage (£10,000 each)

Am a right in thinking - if we split - my partner will be entitled to no more than £10,000? Do I have to pay this to them if we split?

Apologies - a bit confused!!!

Thanks for your point on our plan to pay in £60k - hadnt considered that

getmore4less

Servicing debt is the same a buying a share of the property

Say £60k costs/deposit £240k mortgage
House price £283k

They have a beneficial interest. In 120/300=0.4=40%.

If you pay 10k each off the mortgage

They get 40% of value less £110k left of their share.

Which is less than 10k upto a house value of 300k more if it goes up over that..